ZAGREB, February 4, 2019 - Croatia's public debt at the end of October 2018 was 280.3 billion kuna, which is 3.1 billion or 1.1 percent less than at the same time in the previous year, and could stay below 75 percent at the end of 2018, Raiffeisenbank Austria (RBA) said in an analysis of central bank data on Monday.

Compared with September 2018, public debt shrank by 1.5 billion kuna or 0.5 percent, figures from the Croatian National Bank (HNB) showed.

The annual decrease was due to a fall in both the external and the internal component of public debt. At the end of October 2018, compared with October 2017, the external component declined by 1.9 billion kuna or 1.8 percent to 103.2 billion kuna, while the internal component dropped by 1.1 billion kuna or 0.6 percent to 177.1 billion kuna.

General government guarantees issued on the domestic market reached 6.4 million kuna, of which 2 billion kuna accounted for guarantees for loans issued by the Croatian Bank for Reconstruction and Development (HBOR), while general government guarantees issued on foreign markets stood at 5.3 billion kuna.

On the last day of 2018, enforced state guarantees in the amount of 2.5 billion kuna were paid for Uljanik, which will result in the deterioration of the general government budget balance and affect public debt dynamics, RBA analysts said.

Ultimately, the amount of guarantees settled will be higher given that only a portion of the principal has been paid so far, while interest is yet to be paid. However, trends in fiscal statistics will remain relatively favourable, RBA said.

RBA predicts the public debt to GDP ratio will stay below 75 percent at the end of 2018, down about nine percentage points from its highest level recorded at the end of 2013.

At the end of September 2018, Croatia's public debt amounted to 281.8 billion kuna or 74.5 percent of GDP.

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ZAGREB, January 21, 2019 - The government debt to GDP ratio fell in the European Union in the third quarter of 2018, and Croatia was among the countries with the largest decreases both month on month and year on year, according to data from the EU statistical office Eurostat released on Monday.

"At the end of the third quarter of 2018, the government debt to GDP ratio in the euro area (EA19) stood at 86.1%, compared with 86.3% at the end of the second quarter of 2018. In the EU28, the ratio decreased from 81.0% to 80.8%. Compared with the third quarter of 2017, the government debt to GDP ratio fell in both the euro area (from 88.2% to 86.1%) and the EU28 (from 82.5% to 80.8%)," Eurostat said.

In Croatia, government debt at the end of the third quarter of 2018 stood at 281.8 billion kuna, or 74.5% of GDP, down by 1.6 percentage points from the previous quarter and 4 percentage points lower than at the same time in 2017.

The highest government debt to GDP ratios at the end of the third quarter of 2018 were recorded in Greece (182.2 %), Italy (133.0%), Portugal (125.0%), Cyprus (110.9%) and Belgium (105.4%), and the lowest in Estonia (8.0%), Luxembourg (21.7%) and Bulgaria (23.1%).

Compared with the second quarter of 2018, six member states registered an increase in their debt to GDP ratio at the end of the third quarter of 2018, nineteen a decrease and the ratio remained stable in three member states.

The highest increases in the ratio were recorded in Cyprus (+6.9 percentage points – pp) and Greece (+4.8 pp). The largest decreases were recorded in Malta (-3.1 pp), Slovenia and Croatia (both -1.6 pp), Hungary and Czechia (both -1.4 pp), the Netherlands (-1.1 pp) and Poland (-1.0 pp).

Compared with the third quarter of 2017, four member states registered an increase in their debt to GDP ratio at the end of the third quarter of 2018, and twenty-four a decrease.

An increase in the ratio was recorded in Cyprus (+9.7 pp), Greece (+7.4 pp), the United Kingdom (+0.4 pp) and Slovakia (+0.1 pp), while the largest decreases were recorded in Slovenia (-8.0 pp), Malta (-6.8 pp), Portugal (-4.6 pp), Austria (-4.3 pp), Lithuania (-4.2 pp), the Netherlands (-4.1 pp), Ireland and Croatia (both -4.0 pp), Eurostat said.

More news on the Croatian economy can be found in the Business section.

ZAGREB, November 3, 2018 - At the end of July 2018, Croatia's gross foreign debt was 39.4 billion euro, dropping by 2.2% or by 870 million euro in comparison to July 2017, and thus, it continued decreasing for 32 months in a row year-on-year, the Croatian Chamber of Commerce (HGK) has reported.

The stable and favourable circumstances on the domestic financial market, which is experiencing high liquidity and low interest rates are reasons why all sectors have no need for any larger foreign borrowing thus avoiding additional risks in connection with foreign financing, the HGK says in its analysis of the country's trends.

Broken down by sectors, it was the central bank with the highest deleveraging this July. The Croatian National Bank (HNB) cut its debt by 14.9% year on year. Other monetary institutions followed with their debt decrease by 12.7%, thus having a 75-month-streak of deleveraging.

The gross foreign debt of other domestic sectors fell by 5.9%, going down by 31 months in a row.

General government gross foreign debt increased by 2.1% on the year, and its share in the overall gross foreign debt came to 35.1%. The share of other domestic sectors in this debt was 34.6%, and direct investments accounted for 16.7%, whereas the share of other monetary institutions stood at 9% and the HNB's share at 4.6%.

The HGK analysis notes that a level of the country's gross external debt was brought back to the levels in 2008, however with marked changes in the share of certain sectors in the total debt.

The HGK's analysts expect the ratio of gross foreign debt to GDP to fall to 75% by the end of this year, in parallel to improvements of other indicators of borrowing, and all of that is likely to have a positive effect on Croatia's credit rating.

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ZAGREB, October 22, 2018 - Croatia is among 13 European Union member states which recorded a government budget surplus in 2017 and among 15 EU countries with public debt exceeding 60% of Gross Domestic Product, according to a report released by the EU statistical office Eurostat on Monday.

ZAGREB, October 3, 2018 - At the end of the second quarter of 2018, Croatia's gross foreign debt was 40.1 billion euro, or 80% of GDP, according to central bank figures, and Raiffeisenbank Austria (RBA) analysts predict that the foreign debt-to-GDP ratio will fall below 80% by year's end.

ZAGREB, July 23, 2018 - The debts of 150,474 citizens who each owed the state up to 10,000 kuna plus interests, totalling 1.388 billion kuna, have been written off since Saturday, when the law on writing off physical persons' debts went into force, Prime Minister Andrej Plenković said on Monday.

ZAGREB, July 20, 2018 - At the end of the first quarter of 2018, Croatia's public debt totalled 281.3 billion kuna, a share of 76.2% in its GDP, which was 6.4 percentage points less than in the same period the year before, show statistics released by the EU's statistical office Eurostat on Friday.

ZAGREB, May 22, 2018 - The Croatian Finance Ministry sold 190 million kuna and 28 million euro worth of treasury bills at an auction on Tuesday.

ZAGREB, May 7, 2018 - Croatia's gross foreign debt at the end of January 2018 was 40 billion euro, 2.1 billion or 5% down from the same month of 2017, thus continuing to fall since the end of 2015,says an analysis by Raiffeisenbank Austria (RBA).

ZAGREB, April 20, 2018 - The Croatian Chamber of Commerce (HGK) on Friday commented on a report on a general government surplus and a public debt reduction, saying that progress made in the public finances sector had encouraged progress in the macroeconomic stability of the country and enabled economic growth on healthy foundations.